Franchises typically offer certain advantages to would-be business owners, like an established business model and a recognizable brand. But not all franchises are created equal.

Startup costs, market demand for the product or service, franchise fees, potential revenue, and contract provisions are just some of the factors prospective buyers should consider.

Another factor to keep in mind: how often franchisees who took out loans through the Small Business Administration have been unable to repay.

A low loan failure rate is a vote of confidence both for the franchise business model -- or concept -- and for the people involved with the business, according to Bob Coleman, editor of the Coleman Report, which monitors small business lending trends.

A low loan failure rate also can make it easier for a franchisee to win a bank loan, since lenders keep a keen eye on this data, said Coleman.

The following franchises all had relatively low loan failure rates. Only franchises with at least 70 SBA-backed loans in the past five years are included.



Source: Loan data is from the Small Business Administration, covering loans made from October 2005 through September 2010. Only those franchises for which the SBA backed 70 or more loans were included. A loan was counted as "failed" if the franchisor stopped repaying the loan and the SBA had to purchase -- or take over -- the loan.
Last updated June 16 2011: 12:24 PM ET

This list features the most popular franchises over the past decade -- and how well their owners have done at repaying startup loans backed by the SBA. More

Here are the 10 most affordable cities for doing business, according to PricewaterhouseCoopers and the Partnership for New York City. More

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.